I'm a Fellow at the Adam Smith Institute in London, a writer here and there on this and that and strangely, one of the global experts on the metal scandium, one of the rare earths. An odd thing to be but someone does have to be such and in this flavour of our universe I am. I have written for The Times, Daily Telegraph, Express, Independent, City AM, Wall Street Journal, Philadelphia Inquirer and online for the ASI, IEA, Social Affairs Unit, Spectator, The Guardian, The Register and Techcentralstation. I've also ghosted pieces for several UK politicians in many of the UK papers, including the Daily Sport.

New Zealand Makes The Wrong Choice On Blood Alcohol Levels

New Zealand has just decided to lower the allowable blood alcohol levels (from 0.08% to 0.05%) before someone is deemed to be drunk driving. It is argued that this will make the roads safer and thus save lives (three or four a year). The problem with this is that while it all sounds good in theory it’s not obviously empirically true. For whether or not people commit a crime depends on rather more than just what is the definition of that crime.

Alcohol Healthwatch director Rebecca Williams said it was a long time coming.

New Zealand was previously behind international standards but it was now on a par with Australia, France, the Netherlands and Denmark, and better than Canada, Britain and the United States, where the limit remained at 0.08 per cent. Williams believed Kiwis would see “real positive changes”.

It is simply assumed there that a lower limit is “better”. And that’s not actually the case: what we’re actually interested in is not whatever the limit is but what is the accident rate? And there are more things that influence that accident rate than just what is the definition of drunk driving.

Consider, as an example, the points that Gary Becker makes about crime and criminals. It’s an economic point and none the worse for that: people are rational. So, when thinking about whether to commit a crime they consider the potential effects of doing so. Whether they want to commit it, of course, but also the likelihood of getting caught and then the penalties of doing so. We can construct little equations if we like, penalty if caught and convicted is 10 years, chance of being caught and convicted is 10%, thus the expected cost of committing this crime is 1 year in jail. Now, is what I’ll get from robbing this bank worth one year of my life? No? Then don’t do it. We don’t have to accept that would be criminals really go through a detailed equation like this. It’s enough that we can see these sorts of effects out there in the real world. Kidnapping for ransom is a crime that is pretty much dead and buried in the US these days. The FBI will simply never give up on a case making the chances of being caught too high for whatever profit might theoretically be possible. Would be criminals are acting rationally in not undertaking that crime. We can say much the same about armed (or bank) robberies in the UK these days. Would be criminals have looked at the odds and decided to go off and do something more profitable, like running drugs.

So, assume, as we all do, that the number of people driving while drunk increases the accident rate. There’s therefore at least two things we can do to influence the number of people who do this. One is increase the detection rate, the other is to increase the punishment for having done so. These raise the possible (or probable) cost of having that third or fourth drink. And that’s where this idea of a lower limit being “better” comes unstuck. (Apologies, that’s behind a paywall at The Times). The point I made there being the following:

Tim Worstall takes it apart quite effectively here. I won’t repeat what he says, except to reiterate that Britain has the highest blood-alcohol limit in Europe, and the lowest number of accidents per mile travelled, so we must be doing something right.

The UK has that higher limit: the UK also has a lower accident rate. So, indeed, we must be doing something right. And that right thing that we’re doing is putting the Fear of God into potential drunk drivers because we take away their licences for a year and fine them up to £5,000. And we’ve a high detection rate too. And given that we’ve got that lowest accident rate in Europe while other countries do have those lower limits then that must, empirically, be the way to go about things.

Eric Crampton had a look at this when it was suggested a couple of years back and he makes another economically related point:

But finally we have the really important bit – the part that the anti-alcohol campaigners always manage to leave out. We need to estimate the lost consumer surplus with the reduced drink driving limit. Lots of folks enjoy sharing a bottle of wine with dinner. A lot of them would decide to give wine a pass entirely, or to have less of it, with the rule change. Since they chose previously to consume it, they must value it. And the constraint necessarily then destroys some of that enjoyment. How do we estimate reduced consumer surplus of this sort?

It might sound rather bloodthirsty to be looking at such benefits but with public policy that really is the way that it should be done. We should look at the statistical value of those three or four lives saved (say, $5 million each, a US number but good enough as an example) each year and measure it against the consumer surplus lost each year. And if that consumer surplus lost is more than $20 million then we shouldn’t bring in the rule change. No, I don’t have an estimate for that loss and nor does Eric. That’s rather what he’s complaining about, that no one does and therefore no one is considering it.

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